What’s in it for You?

Employee

You know the falling dollar is slowly robbing you of your salary. By the time you get your next raise, you’re lucky to get back to even. Whoever benefits from the decline, it sure isn’t you. In real terms, you make a lot less than your parents did, especially if they worked before 1971 when the dollar was still tied to gold.

The rise of technology conceals the effect of the falling dollar. The middle class is being destroyed, along with the opportunity to accumulate wealth and the hope of upward mobility.

It gets worse. Savings is almost impossible today. Without savings, there can be no investment, and it is investment that creates new jobs. Fewer jobs are created, while mature companies are always cutting costs and jobs. Total employment falls, and the more unemployed people there are competing for a job, the lower the pay.

If only there were a currency that didn’t rob you and destroy your job…

Retiree

When your dad retired in 1970, your parents were sitting pretty on his pension. In less than 10 years you had to help them out, as prices skyrocketed. He never said it, but you know he felt guilty for having to lean on you.

Your oldest brother’s pension is indexed for inflation. It doesn’t really keep up, but at least it’s something. You worry for him every time you read about another underfunded pension. Are any of them properly funded? Is it possible to guarantee investing returns will always stay ahead of the falling dollar?

You aren’t lucky enough to have that problem. Companies moved to 401k plans. It’s not some pension fund manager who has the problem—it’s you. How do you make enough money on your savings to pay for a comfortable lifestyle? The interest paid by the bank or even a government bond isn’t even close. You choice is to eat your savings, or gamble in real estate and stocks.

Your kids are not in a position to help you the way you did with your parents. Social Security is not enough, even if Congress doesn’t mess it up. Either they will to do something or else it is going to crash.

You have some cash in the bank and some investments. Would you really choose to give up this wealth in exchange for a promise to be taken care of, to keep the status quo a while longer?

If only there were a currency that let you enjoy your golden years without worry…

Saver

You, like everyone else, are robbed. It’s like a hidden tax as the dollar loses value every year. But what can you do? Your friend saw the E*Trade ads with the baby that makes trading looking easy. She tried, and quickly lost $50,000. It isn’t so easy.

So how do you save up to buy a car, pay for your daughter’s education, an unanticipated uncovered surgery, or for retirement? It’s like a treadmill and you can’t get ahead, no matter how fast you run.

It gets worse. When you make a deposit, you are lending money to the bank. The bank was supposed to lend to productive businesses that use the capital to expand production and profits. Increasingly, banks end up lending to borrowers who just consume, such as the government. This is not savings, but a con game. The government says they will bail out depositors of any insolvent bank, but who will bail out the insolvent government?

In the meantime, you get so little interest that you wonder if you would be better off keeping paper cash under the mattress. The saver has no say in the interest rate. You are disenfranchised.

If only there were a currency that made it possible to save…

Investor

Prices are screaming at you all day long. They are on every screen (even at the health club!), and there are realtime alerts on your phone if you aren’t at a screen. AAPL is -0.4% and F is +0.9%, the Treasury bond is +1.3 and copper is flat. The Case-Shiller home price index rose this month.

Everyone knows the price of everything! But so what? Does anyone know the value of anything? Investing is supposed to be about buying a good value. Is there such a thing? They’ve turned markets into casinos for speculation.

Between 1981 and 2000, the game was simple. Buy stocks and buy bonds. There were corrections, but everything went up. After 2001, the game was to buy real estate. Stocks were busted, but bonds were still good and real estate could only go up. After 2008, it doesn’t look so simple. Some stocks have a good dividend, but another 2008-style correction could wipe out many years of dividends.

You know that real investing is about buying productive assets to earn a return, not speculating that a greater fool will buy you out a higher price. With the Zero Interest Rate Policy, the yield on safe investments is ridiculous. It doesn’t keep up with the falling dollar. Do you buy unsafe investments?

The Fed has injected so many dollars since 2008 that the markets have become bubbles again. Holding cash will lead to certain losses. Buying into a bubble will lead to big gains for a few nimble traders, and big losses for everyone else when the bubble pops. Is there anywhere that’s safe?

If only there were a currency that the Fed couldn’t use to make bubbles…

Student

The cost of school is skyrocketing. The more money the government throws at the problem of “making education affordable” the more prices go up. It is impossible to pay for school the way your parents did by saving during high school and working part-time while in college (if you can even get a job).

You face a dilemma. If you don’t go to school, you will likely earn less money and may not end up in a career you enjoy. But to go to school, you have to borrow the money. It is easy to get a student loan, but if you don’t earn enough to pay it off, you can’t get out from under the debt even in bankruptcy. It’s a big risk when the job market is weak. Your older sister is still unemployed, two years after graduating. Now you know what “debt slave” means.

Where do they get so much money to lend to so many people to drive up the cost of school so much? All this lending just creates an arms race. You need an education, but so do millions of other people. The price is set by whoever is willing to borrow the most.

If only there were a currency which couldn’t fuel a college arms race…

Unemployed

Many good people have lost their jobs in the last few years. Once you’re out of the workforce for a while, it can be really tough to get back in. The talking heads on TV sometimes blame greed, corporations, or China for the lack of jobs. Corporations were just as greedy in the 90’s and China was there even then. The difference is the economy. It’s bad and getting worse. These same TV analysts also say that the economy continues to add jobs, so what do they know?

What causes a bad economy? People want to work, the same as they did when it was good. Companies want to make more money and have to hire people to do it, the same as they did. The difference is that capital has been destroyed.

Imagine you were shipwrecked alone on a large island that had all the raw materials you could want. At first, you would have to spend all day just to get enough food to eat. You would have to work overtime to build a shelter and a fire pit. And then you would have to build something to store water. After that, you might make a net to catch fish more easily.

The net, the fire pit, and everything else you worked overtime to build are capital. You have to produce more than you consume in order to accumulate capital. It is capital that lets you produce more. When you first landed on the island, you could not hire anyone to do anything; you had nothing to pay. But after a year of hard work, you could hire the next shipwrecked guy to work your fishing net. You would be freed up to work on a storage building to store smoked fish for the dry season.

Businesses have gone bankrupt, workers have been laid off, homeowners have been foreclosed, and investors lost money. This is the proof that capital has been destroyed. It is just like a huge storm wiping all of your hard work off that island. It would reset you back to zero. The dollar itself is the cause of that storm, known as the boom and bust cycle.

If only there were a currency that did not destroy capital…

Business Manager

Everyone knows that the dollar falls. So they speculate to try to stay ahead. This causes bubbles to inflate and pop in every market. Look at copper, for example. It went from $2.40 to $4.50, then down to $3.05. The volatility could kill anyone who depends on copper. You have to hedge. Hedging mitigates the volatility problem, but it’s expensive. Your margins shrinks further.

Copper only affects a few industries, but the interest rate affects everyone. What if it rises? Say you borrowed money at 5% to build out a restaurant. Years later, it looks tired and diners are starting to go elsewhere. If you don’t refresh the decor, revenues will keep falling and you will have to close it. Everyone will be laid off. Unfortunately, at 10% interest, there is no business case for the project. In a rising rate environment, one by one companies close their doors; they cannot borrow cost-effectively to replace their worn out assets.

Falling rates are just as deadly. You borrowed at 10% and you somehow make a (small) profit. Your bonus shrank, but at least you still have a job. Then interest falls to 5%. A competitor borrows more than you to open up next door. His store is much nicer than yours, and he has the same monthly payment. It becomes the new hot spot, and you can’t fill your tables even on Friday night.

Rising rates smacked the left side of your face. Falling rates didn’t heal the damage, but hit you on the right side.

If only there were a currency which had stable interest rates…

Business Owner

Cash is always losing value. Ideally, you could avoid holding any, but every business needs a buffer for its cash flow. The smaller you make the buffer, the larger the risks. So you try to hold earning assets and hope they make more than the dollar loses. Then the IRS charges tax on the “gains”.

It gets worse. The elephant in the room is that you use the dollar as the unit of account in your books. The dollar is unstable, and falling.

Would you expect a contractor to build something if he measured beams to length using a rubber band that stretched every time he used it? How can you expect your accountant to tell you if you made or lost money if the value of money itself changes?

The shrinking dollar can trick you into thinking you made money, and fool you into consuming your capital. Bear Sterns appeared quite profitable until it failed.

If only there were a currency that could be trusted like a meter stick …

Landlord

You worry that you bought your property at too high a price. There were so many other people desperate to buy real estate that prices went crazy. You wanted to get in before they went completely out of sight. Some of your buddies overpaid and went bankrupt when real estate fell. Prices are rising again.

At least your property is in a good location and there is demand. Your next problem is how to set the length of a lease. The best tenant wants to sign a long-term lease, and of course today will not agree to a big annual rent increase. Do you lock yourself in to a rent that could drop a lot in real terms, if prices really begin to rise again? This is what the Fed says it wants. How can you plan for, and commit to a long-term investment without knowing what the dollar will be worth at the end?

If only there were a currency you could trust for long-term contracts…

Homeowner

Unless you are an economist, there is no way to know when interest rates are going up or down much less which way home prices will go next. The realtor told you that a home is a good investment, and home prices never go down. You and everyone else learned in 2007 that this was a lie. Now you owe more than your home is worth. They say that home prices are going up again. You have a choice to keep paying the mortgage or just walk away (and destroy your credit).

Welcome to the boom and bust cycle. In the boom everyone borrows money to buy assets, like houses, that they think will go up. Then it turns to bust. Prices of assets fall, but you still owe the full debt.

Meanwhile, the town is trying to raise taxes, the cost of heating and air conditioning is rising, and some of the houses in the neighborhood really look like they are falling apart.

If only there were a currency that did not create these crazy booms and busts…

Tenant

Many people who used to own a home are now renting. They bought houses they could not afford because everyone else was doing it. The banks have foreclosed on them, and now their credit is trashed. Where did all that money come from, that these people borrowed to buy all those expensive houses?

Anyway, that’s not your problem. There are so many of them and they are bidding up the cost of rent. It is harder and harder to budget, and if rents go up too much more, you may be forced to downsize, live in a bad neighborhood, or move further away.

At one point, you were even thinking to save up some money for a down payment and buy a house yourself. But house prices are unstable and you know some ex-homeowners who went through hell. It just doesn’t seem like a good idea.

If only there were a currency that did not make home prices and rents so volatile…

Welfare Recipient

If you feel trapped into a life you did not choose and do not know how to get out of, then think about this. The welfare state has made it all but impossible for you to live like a human being, working productively to support yourself.

At every turn, the welfare state has offered you what seemed like an easier alternative. Instead of hard work and delayed gratification, it has given you more free stuff than you could earn without job skills. Once you start collecting welfare checks, you don’t gain knowledge or skill. You fall farther and farther behind. The effort and discipline required to learn and work go up, while your motivation goes down.

How can they come up with the money to put more than forty million people on the dole? If the government had to raise taxes on working folk, there would have been a tax revolt long before now.

Only unlimited borrowing makes it possible to have a massive welfare state. This kind of borrowing requires paper money and the Fed.

If you truly don’t care any more, then this site is not written for you. Neither gold nor anything else can help you. But if you still have some self-esteem and a desire support yourself by your own efforts, then this site is an appeal to the passionate part of you that loves life.

If only there were a currency which made the welfare state impossible…